To calculate the salary needed in 2021 to keep up with inflation, we will use the following formula related to inflation:

$S_{2021} = S_{2014} \times (1 + r)^n$

Where:

• $S_{2021}$ is the salary in 2021.
• $S_{2014}$ is the salary in 2014, which is $55,000.
• $r$ is the inflation rate per year (2% = 0.02).
• $n$ is the number of years between 2014 and 2021 (which is 7 years).

Now, substituting the values into the formula:

$S_{2021} = 55,000 \times (1 + 0.02)^7$

Let’s calculate it.The salary needed in 2021 to keep up with a 2% annual inflation rate would be approximately $63,177.71.

Would you like to explore further details about inflation or salary growth?

Here are some related questions:

1. How would the salary change if the inflation rate were higher, like 3%?
2. What would be the salary in 2024 using the same inflation rate?
3. How does compounding interest relate to inflation in salary calculations?
4. What would be the total amount of inflation over these 7 years?
5. How can salary increases be calculated if there are varying inflation rates each year?

Tip: To calculate salary increases over multiple years with inflation, always use the formula $S_{future} = S_{current} \times (1 + r)^n$, where $r$ is the inflation rate and $n$ is the number of years.